(3) Cost certification. -
The certification obtained by the State Historic Preservation Officer from the
taxpayer of the amount of the qualified rehabilitation expenditures or the
rehabilitation expenses incurred with respect to a certified rehabilitation of
an eligible site.

(3a) Development tier
area. - Defined in G.S. 143B-437.08.

(4) Eligibility
certification. - The certification obtained from the State Historic
Preservation Officer that the applicable facility comprises an eligible site.

(5) Eligible site. - A
site located in this State that satisfies all of the following conditions:

a. It was used as a
manufacturing facility or for purposes ancillary to manufacturing, as a
warehouse for selling agricultural products, or as a public or private utility.

b. It is a certified
historic structure or a State-certified historic structure.

c. It has been at least
eighty percent (80%) vacant for a period of at least two years immediately
preceding the date the eligibility certification is made.

d. Repealed by Session
Laws 2008-107, s. 28.4(a), effective for taxable years beginning on or after
January 1, 2008.

(a) Credit. - A
taxpayer who is allowed a credit under section 47 of the Code for making
qualified rehabilitation expenditures of at least three million dollars
($3,000,000) with respect to a certified rehabilitation of an eligible site is
allowed a credit equal to a percentage of the expenditures that qualify for the
federal credit. The credit may be claimed in the year in which the eligible
site is placed into service. When the eligible site is placed into service in
two or more phases in different years, the amount of credit that may be claimed
in a year is the amount based on the qualified rehabilitation expenditures
associated with the phase placed into service during that year. In order to be
eligible for a credit allowed by this Article, the taxpayer must provide to the
Secretary a copy of the eligibility certification and the cost certification.
The amount of the credit is as follows:

(1) For an eligible site
located in a development tier one or two area, determined as of the date of the
eligibility certification, the amount of the credit is equal to forty percent
(40%) of the qualified rehabilitation expenditures.

(2) For an eligible site
located in a development tier three area, determined as of the date of the
eligibility certification, the amount of the credit is equal to thirty percent
(30%) of the qualified rehabilitation expenditures.

(b) Allocation. -
Notwithstanding the provisions of G.S. 105-131.8 and G.S. 105-269.15, a pass-through
entity that qualifies for the credit provided in this section may allocate the
credit among any of its owners in its discretion as long as an owner's adjusted
basis in the pass-through entity, as determined under the Code, at the end of
the taxable year in which the eligible site is placed in service, is at least forty
percent (40%) of the amount of credit allocated to that owner. Owners to whom a
credit is allocated are allowed the credit as if they had qualified for the
credit directly. A pass-through entity and its owners must include with their
tax returns for every taxable year in which an allocated credit is claimed a
statement of the allocation made by the pass-through entity and the allocation
that would have been required under G.S. 105-131.8 or G.S. 105-269.15.

(c) Forfeiture for
Change in Ownership. - If an owner of a pass-through entity that has qualified
for the credit allowed under this section disposes of all or a portion of the
owner's interest in the pass-through entity within five years from the date the
eligible site is placed in service and the owner's interest in the pass-through
entity is reduced to less than two-thirds of the owner's interest in the pass-through
entity at the time the eligible site was placed in service, the owner forfeits
a portion of the credit. The amount forfeited is determined by multiplying the
amount of credit by the percentage reduction in ownership and then multiplying
that product by the forfeiture percentage. The forfeiture percentage equals the
recapture percentage found in the table in section 50(a)(1)(B) of the Code.

(d) Exceptions to
Forfeiture. - Forfeiture as provided in subsection (c) of this section is not
required if the change in ownership is the result of any of the following:

(1) The death of the
owner.

(2) A merger,
consolidation, or similar transaction requiring approval by the shareholders,
partners, or members of the taxpayer under applicable State law, to the extent
the taxpayer does not receive cash or tangible property in the merger,
consolidation, or other similar transaction.

(e) Liability from
Forfeiture. - A taxpayer or an owner of a pass-through entity that forfeits a
credit under this section is liable for all past taxes avoided as a result of
the credit plus interest at the rate established under G.S. 105-241.21,
computed from the date the taxes would have been due if the credit had not been
allowed. The past taxes and interest are due 30 days after the date the credit
is forfeited. A taxpayer or owner of a pass-through entity that fails to pay
the taxes and interest by the due date is subject to the penalties provided in
G.S. 105-236. (2006-40,
s. 1; 2006-252, s. 2.23; 2006-259, s. 47.5; 2007-491, s. 44(1)a; 2008-107, s.
28.4(b).)

(a) Credit. - A
taxpayer who is not allowed a federal income tax credit under section 47 of the
Code and who makes rehabilitation expenses of at least three million dollars
($3,000,000) with respect to a certified rehabilitation of an eligible site is
allowed a credit equal to a percentage of the rehabilitation expenses. The
entire credit may not be taken for the taxable year in which the property is
placed in service, but must be taken in five equal installments beginning with
the taxable year in which the property is placed in service. When the eligible
site is placed into service in two or more phases in different years, the
amount of credit that may be claimed in a year is the amount based on the
rehabilitation expenses associated with the phase placed into service during
that year. In order to be eligible for a credit allowed by this Article, the
taxpayer must provide to the Secretary a copy of the eligibility certification
and the cost certification. For an eligible site located in a development tier
one or two area, determined as of the date of the eligibility certification,
the amount of the credit is equal to forty percent (40%) of the rehabilitation
expenses. No credit is allowed for a site located in a development tier three
area.

(b) Allocation. -
Notwithstanding the provisions of G.S. 105-131.8 and G.S. 105-269.15, a pass-through
entity that qualifies for the credit provided in this section may allocate the
credit among any of its owners in its discretion as long as an owner's adjusted
basis in the pass-through entity, as determined under the Code, at the end of
the taxable year in which the eligible site is placed in service, is at least
forty percent (40%) of the amount of credit allocated to that owner. Owners to
whom a credit is allocated are allowed the credit as if they had qualified for
the credit directly. A pass-through entity and its owners must include with
their tax returns for every taxable year in which an allocated credit is
claimed a statement of the allocation made by the pass-through entity and the
allocation that would have been required under G.S. 105-131.8 or G.S. 105-269.15.

(c) Forfeiture for
Change in Ownership. - If an owner of a pass-through entity that has qualified
for the credit allowed under this section disposes of all or a portion of the
owner's interest in the pass-through entity within five years from the date the
eligible site is placed in service and the owner's interest in the pass-through
entity is reduced to less than two-thirds of the owner's interest in the pass-through
entity at the time the eligible site was placed in service, the owner forfeits
a portion of the credit. The amount forfeited is determined by multiplying the
amount of credit by the percentage reduction in ownership and then multiplying
that product by the forfeiture percentage. The forfeiture percentage equals the
recapture percentage found in the table in section 50(a)(1)(B) of the Code. The
remaining allocable credit is allocated equally among the five years in which
the credit is claimed.

(d) Exceptions to
Forfeiture. - Forfeiture as provided in subsection (c) of this section is not
required if the change in ownership is the result of any of the following:

(1) The death of the
owner.

(2) A merger,
consolidation, or similar transaction requiring approval by the shareholders,
partners, or members of the taxpayer under applicable State law, to the extent
the taxpayer does not receive cash or tangible property in the merger,
consolidation, or other similar transaction.

(e) Liability from
Forfeiture. - A taxpayer or an owner of a pass-through entity that forfeits a
credit under this section is liable for all past taxes avoided as a result of
the credit plus interest at the rate established under G.S. 105-241.21,
computed from the date the taxes would have been due if the credit had not been
allowed. The past taxes and interest are due 30 days after the date the credit
is forfeited. A taxpayer or owner of a pass-through entity that fails to pay
the taxes and interest by the due date is subject to the penalties provided in
G.S. 105-236. (2006-40,
s. 1; 2006-252, s. 2.24; 2007-491, s. 44(1)a; 2008-107, s. 28.4(c).)

§ 105-129.73. (See note for
repeal) Tax credited; cap.

(a) Taxes Credited. -
The credits allowed by this Article may be claimed against the franchise tax
imposed under Article 3 of this Chapter, the income taxes imposed under Article
4 of this Chapter, or the gross premiums tax imposed under Article 8B of this
Chapter. The taxpayer may take the credits allowed by this Article against only
one of the taxes against which it is allowed. The taxpayer must elect the tax
against which a credit will be claimed when filing the return on which it is
claimed. This election is binding. Any carryforwards of the credit must be
claimed against the same tax.

(b) Cap. - A credit
allowed under this Article may not exceed the amount of the tax against which
it is claimed for the taxable year reduced by the sum of all credits allowed,
except payment of tax made by or on behalf of the taxpayer. Any unused portion
of the credit may be carried forward for the succeeding nine years. (2006-40, s. 1.)

§ 105-129.74. (See note for
repeal) Coordination with Article 3D of this Chapter.

A taxpayer that claims a
credit under this Article may not also claim a credit under Article 3D of this
Chapter with respect to the same activity. The rules and fee schedule adopted
under G.S. 105-129.36A apply to this Article. (2006-40, s. 1.)

§ 105-129.75. Sunset.

This Article expires January 1, 2015, for rehabilitation
projects for which an application for an eligibility certification is submitted
on or after that date. Eligibility certifications under this Article expire
January 1, 2023. (2006-40, s. 1; 2008-107, s.
28.4(d); 2010-31, s. 31.5(a); 2012-36, s. 12(b); 2015-241, s. 32.3(b).)

§ 105-129.75A. (See note for repeal) Report.

The Department must include in the economic incentives report
required by G.S. 105-256 the following information itemized by taxpayer:

(1) The number of taxpayers that took the credits
allowed in this Article.

(2) The amount of rehabilitation expenses and qualified
rehabilitation expenditures with respect to which credits were taken.

(3) The total cost to the General Fund of the credits
taken. (2010-166, s.
1.8.)